The Everything Code TL;DR. The labor force participation rate isn’t going to rise anytime soon – it’s set to keep declining over time. This is a structural problem… We’ve got aging demographics, falling birth rates, and now the rise of automation. Humans are already being
The log regression channel says the same: The labor force participation rate will continue to decline over time…
To offset the demographic decline – at least until productivity starts to pick up again (likely around 2030 but maybe sooner) – the only answer is more debt. That’s how the system survives. It’s the only way to keep the whole thing from unraveling… When both the public and
And that leads us back to this… Debt to GDP is going to keep rising over time...
And that leads to more debasement to pay for it over time too... All government debt in excess of GDP just gets monetized…
But gradually, major governments have switched the method of debasement. At first, they focused on central bank balance sheets… Then, as the market caught on to the debasement trick, they quickly shifted to Net Liquidity. Over the last couple of years, they’ve moved to using
And the really big picture is that there is still a vast amount of interest payments that need to get monetized, which have far exceeded GDP growth…
And when we include our GMI Total Liquidity measures for other major regions and combine them with our US number, liquidity explains around 90% of Bitcoin’s price fluctuations…
… and 95% for the NASDAQ 100…
We also know that nothing is accumulating purchasing power outside of technology stocks and Bitcoin. The NASDAQ 100 has been compounding purchasing power at around 13% in total return terms (including dividends), outpacing the real rate of debasement, which is around 8% – or
Bitcoin has been compounding purchasing power faster than any asset in human history – annualizing nearly 150% in excess of the debasement rate since 2010. More recently, using 2012 as a starting point to compare with the NASDAQ 100 chart above, Bitcoin has generated nearly a
As mentioned earlier, the only other asset outside of Bitcoin that’s actually making you richer is tech. But even then, the NASDAQ 100 is down 99.94% versus Bitcoin since the start of 2012. Shocking… You see, this is exactly why @RaoulGMI and I have been saying for years that
As our long-term GMI predictions play out, we’re entering a period that will be both incredibly challenging and unimaginably rewarding – the worst of times and the best of times. Bitcoin is part of the solution... We’re still in the early stages of a global race – a scramble by
